<html> <head><style type ="text/css">body { font-family: "Bloomberg Prop Unicode I", Verdana, sans-serif; font-size:125%; letter-spacing: -0.3pt; color: #FF9F0F; background-color: #000000; text-align: left; } p {line-height: 1.25em; max-width:900px; width:expression(document.body.clientWidth > 900? "900px": "auto" );} h1, h2, h3 { text-align: left; font-weight: normal; color: #FFFFFF; } h1 { font-size: 130%; } h2 { font-size: 115%; } h3 { font-size: 100%; } #bb-style { font-size: 90%; max-width:900px; width:expression(document.body.clientWidth > 900? "900px": "auto" ); } b, strong { font-weight: bold; } i, em { color: #FEC54A; } pre { font-family: "Andale Mono", "Monaco", "Lucida Console"; letter-spacing: -0.3pt; line-height: 1.25em; } table { border: 0; font-size: 90%; width: 100%; margin-left: auto; margin-right: auto; } td, tr { text-align: left; } td.numeric { text-align: right; } a:link { color:#53B2F5; text-decoration: none; } a:visited {color:#53B2F5} a:active {color:#53B2F5} a:hover {color:#53B2F5} </style> </head> <body> <p>By James Greiff</p>&#xD; &#xD; <p>The signs of panic were everywhere today. Stock markets plunged&#xA0;in the U.S. and Europe. The flight to&#xA0;safety saw cash pouring into U.S.&#xA0;Treasury bonds, pushing yields&#xA0;to levels last seen in the 1950s, out of concern that the two-year recovery in the world&#x2019;s largest economy is stalling.&#xA0;Italian and Spanish bond yields, on the other hand,&#xA0;soared to record levels&#xA0;as Europe's two-week-old deal to contain the rot of the Greek debt crisis seemed to be coming apart.</p>&#xD; &#xD; <p>One of the best measures of fear in the market is the Chicago Board Options Exchange Volatility Index, or the VIX, a benchmark for stock options. The VIX soared to the highest in at least a year, closing at 31.66, a 35 percent gain. The last time the index reached this level was&#xA0;in early July 2010, when the first phase of Greek debt crisis was still rattling financial markets.</p>&#xD; &#xD; <p>For most of the spring and summer, the VIX gave little hint that a fresh round of turmoil was in the offing. Even as Europe struggled to devise a second round of assistance for Greece and U.S. lawmakers failed to reach an agreement on raising the debt ceiling, the VIX bounced around between 15 and 20. It was only in the last week of July that the VIX began to reflect the anxiety that culminated in today's market rout.</p>&#xD; &#xD; <p>The VIX&#xA0;is still a long way from the high reached at the peak of the 2008 credit crunch. In October 2008, it touched a high of 89.53.</p> </body> </html>